It was all smiles for Google’s parent company Alphabet for now as the company’s shares went up by over 9 per cent after a strong showing in the second quarter. Alphabet Inc. returned with revenues that beat the industry expectations and took the market by storm on Thursday. Alphabet also stated that its Board of Directors has approved a buyback worth USD 25 billion for its Class C Capital stock. The strong earnings are mainly credited to higher ad sales and a boom in cloud technology.
Ad sales has become Google’s traditional earnings now and was yet again at the helm of the company’s strong showing. Google’s cloud service was a big positive for Alphabet Inc. as the company is aiming for it to be at the forefront of growth going forward. The total revenue reported from ad sales read around USD 32.6 billion for the second quarter, which stood at around USD 28.09 billion during the same period last year. In February last year, Sundar Pichai had stated that Google’s cloud business was generating a billion dollar each quarter. However, it has spiked up to record an annual run rate of USD 8 billion. Google is doing its bit to boost its cloud technology as much as it can. It hired Thomas Kurian recently as cloud’s new head and have acquired Looker post that. The earnings per share went up by around 21 per cent to stand at USD 14.21 per share. Cost-per-click though fell by around 11 per cent.
Google is also expected to face regulatory actions from FTC after Facebook was fined by the commission for alleged privacy breach. Google too is under investigation and might soon have to suffer an even bigger settlement than Facebook if things don’t improve. The fines are expected to grow further as critics heavily bashed FTC for settlement with Facebook.